Ted Cruz
Republican presidential candidate Ted Cruz reportedly failed to disclose a Goldman Sachs loan to finance his Senate bid in 2012.Reuters

Texas Senator Ted Cruz failed to disclose two loans from Citibank and Goldman Sachs to fund his Senate bid in 2012 in what could be a potential violation of federal election rules.

According to the New York Times, which first reported the story, the Republican presidential candidate claimed he had asked his wife to liquidate their entire net worth and put it towards his Senate campaign. The couple's decision to put over $1m (£690,000) into Cruz's successful Senate bid, however, was made easier by a loan from Goldman Sachs, where his wife Heidi Cruz works.

Campaign finance reports in the weeks before the May 2012 Republican primary show Cruz put $960,000 (£666,000) in "personal funds" into the campaign. Two months later, before a scheduled run-off election, Cruz added additional funs to bring the total to $1.2M (£830,000). At the time, Cruz told The New York Times the money was "all we had saved".

However, the paper found that a review of personal financial disclosures Cruz filed later with the Senate does not reveal a liquidation of assets that accounted for all the money he spent on the campaign. The disclosures did reveal two low-interest loans from Goldman Sachs and from Citibank. The loans totalled $750,000 (£520,000)—later rising to $1M (£690,000)—before being paid down.

The newspaper reported that neither loan appears in reports filed with the Federal Election Commission. Campaigns have been subjected to investigations and fined for failing to disclose such information in the past.

Cruz campaign spokeswoman Catherine Frazier confirmed that the Goldman Sachs loan had been used during the campaign. She added that Cruz sold stocks and liquidated savings as well. Frazier said that failure to report the as much as $500,000 (£347,000) Goldman Sachs loan was "inadvertent" and was not an attempt to hide anything. According to CNN, Frazier said Cruz did not receive any special terms on the loan and has since paid it off.

"These loans have been disclosed over and over and over again," Cruz told reporters after news broke, CNN reported. "It is an inadvertent filing question. The facts of the underlying matter have been disclosed for many, many years."

When speaking to reporters in South Carolina, Frazier said, "Now we realise that we should have disclosed it, yes. It's a matter of semantics in terms of listing that that was a loan and we're asking the FEC what we need to do to update it, if anything."

The news of the potential violation comes on the eve of the first Republican debate of 2016 in North Charleston, South Carolina. Cruz, who has steadily risen the polls to come in second behind Donald Trump, has also faced questions regarding his eligibility to run for president in the first place. The Texas senator was born in Canada to a US citizen and thus received his citizenship through his mother. Many argue that Cruz is not a "natural born citizen" and is therefor not eligible to be president of the US.